6 worked Employee Payroll Setup case studies — the position a client typically comes to us with, what we do, and what it is worth. Each is an illustrative example built on the rules that apply to employee payroll setup work, not a specific client's file.
Case Study 1 · Backlog brought current
Collections Halted And $22,000 Cut From A 5-Year Backlog — Contractor-Paid Clinic, Edmonton
Client: A clinic paying its associates as contractors · Where: Edmonton, Alberta · Engagement: 7 weeks, fixed fee
Balance reduced by$22,000
Backlog cleared5 years
CollectionsHalted
The situation — A clinic paying its associates as contractors, Edmonton, Alberta
By the time a clinic paying its associates as contractors in Edmonton, Alberta called, 5 years were outstanding and the CRA had assessed on estimates. Underneath it sat company vehicles used personally with no logbook and no taxable benefit reported.
What we did for A clinic paying its associates as contractors, Edmonton, Alberta
We reconstructed the records year by year and reconstructed vehicle logbooks, calculated the standby charge and operating benefit properly, and amended the affected T4s. Each filing replaced an arbitrary assessment with a real one.
The result — A clinic paying its associates as contractors, Edmonton, Alberta
The account is current. Filing on real numbers rather than CRA estimates reduced the balance by $22,000, and a relief application addressed part of the accumulated interest.
Case Study 2 · Planning that cut the bill
$60,000 Cut From The Annual Tax Bill — Mixed-Crew Construction Firm, Moncton
Client: A construction firm with union and non-union crews · Where: Moncton, New Brunswick · Engagement: 5 weeks, fixed fee
First-year saving$60,000
RepeatsAnnually
Filing positionUnchanged in risk
The situation — A construction firm with union and non-union crews, Moncton, New Brunswick
A construction firm with union and non-union crews in Moncton, New Brunswick was compliant but paying more than it needed to. The prior year had been filed correctly and still left a director facing a personal assessment for unremitted source deductions on the table.
What we did for A construction firm with union and non-union crews, Moncton, New Brunswick
We modelled the current position against the alternatives before changing anything, then filed the outstanding slips and summary and requested relief on the per-slip penalty with the reasons documented in writing.
The result — A construction firm with union and non-union crews, Moncton, New Brunswick
The change saved $60,000 in the first year and repeats annually. Nothing about the filings became more aggressive; the position is simply the one the rules already allowed.
Client: An employer whose remittance frequency moved up a threshold · Where: Saskatoon, Saskatchewan · Engagement: 4 weeks, fixed fee
Annual saving$73,000
ReorganisationTax-neutral
StructureMatches operations
The situation — An employer whose remittance frequency moved up a threshold, Saskatoon, Saskatchewan
An employer whose remittance frequency moved up a threshold in Saskatoon, Saskatchewan was carrying an employee over-deducted for CPP and EI after being moved between two related payroll accounts mid-year, and every option for fixing it ran through a reorganisation that had to be done without triggering tax.
What we did for An employer whose remittance frequency moved up a threshold, Saskatoon, Saskatchewan
Working with the client's lawyer, we reconciled the payroll register, general ledger and T4 summary to the cent, then filed the amended slips and prepared the elections, resolutions and valuations the structure needed to stand up.
The result — An employer whose remittance frequency moved up a threshold, Saskatoon, Saskatchewan
The structure now matches the business. Annual saving of $73,000, and the reorganisation itself was tax-neutral.
Case Study 4 · Scaling without breaking
Growth Handled Without A Missed Filing, $90,000 Freed — Two-Province Retail Chain, Calgary
Client: A retail chain across two provinces · Where: Calgary, Alberta · Engagement: 7 weeks, fixed fee
Cash freed$90,000
Compliance failuresNone
ReportingMonthly
The situation — A retail chain across two provinces, Calgary, Alberta
A retail chain across two provinces in Calgary, Alberta was opening in a second province — different filing obligations, a different payroll regime, and remittances still going out monthly after the business had moved to the accelerated threshold already in the file.
What we did for A retail chain across two provinces, Calgary, Alberta
We wrote each pay code against its income tax, CPP and EI treatment, so a new benefit could not reach the payroll without a decision on how it was withheld and put monthly reporting in place so the owner could see the cash effect of growth while there was still time to act on it.
The result — A retail chain across two provinces, Calgary, Alberta
Growth was absorbed without a compliance failure. $90,000 of cash was released, and the monthly reporting now flags a problem while it is still small.
Case Study 5 · Objection and relief
$65,000 Of Penalties And Interest Cancelled On Relief — Company-Vehicle Employer, Red Deer
Client: An employer providing company vehicles · Where: Red Deer, Alberta · Engagement: 11 weeks, fixed fee
Penalties and interest cancelled$65,000
Relief groundsAccepted
AssessmentAdjusted to filed position
The situation — An employer providing company vehicles, Red Deer, Alberta
An assessment of $65,000 landed at an employer providing company vehicles in Red Deer, Alberta following a desk review. The auditor had not seen the records behind T4s that did not agree to the payroll register or the general ledger.
What we did for An employer providing company vehicles, Red Deer, Alberta
We paid the accrued bonus inside the 179-day window and kept the deduction in the year it was accrued, then set out the legislative basis for the position alongside the documents supporting it.
The result — An employer providing company vehicles, Red Deer, Alberta
$65,000 of penalties and interest was cancelled under the taxpayer relief provisions, and the underlying assessment was adjusted to match the filed position.
Case Study 6 · CRA review defended
Audit Defence Closed In 7 Weeks, $42,000 Cleared — Stock-Option Tech Team, Hamilton
Client: A growing tech team with stock options · Where: Hamilton, Ontario · Engagement: 7 weeks, fixed fee
Proposed tax cleared$42,000
Review duration7 weeks
OutcomeNo change
The situation — A growing tech team with stock options, Hamilton, Ontario
A growing tech team with stock options in Hamilton, Ontario was selected for review after a bonus accrued to bring the year-end tax bill down and still unpaid more than a year later showed up in the CRA's automated matching. The proposed adjustment on employee payroll setup came to $42,000.
What we did for A growing tech team with stock options, Hamilton, Ontario
We moved the account to the correct remitter frequency, caught up the arrears, and filed a taxpayer relief request that cancelled the bulk of the penalty. Every figure in the response traced to a source record the auditor could verify without asking a second question.
The result — A growing tech team with stock options, Hamilton, Ontario
The review closed with no change. $42,000 of proposed tax came off the table, and the documentation now in place makes the next review a short one.
Reviewed for the 2025 tax year by Udit Gupta, Founder and Tax Accountant. These case studies are illustrative worked examples composed from the CRA rules that apply to this type of work, not specific client files; figures are representative and outcomes depend on your own facts.
